The International Air Transport Association (IATA), which represents some 280 airlines comprising 83% of global air traffic, has released data for global air freight markets revealing that demand, measured in freight tonne kilometers (FTKs), was up 1.7% in March 2018, compared to March 2017. This represents a drop of five percentage points compared to the February result and is also the slowest growth pace for the last 22 months.
For the first time in 20 months annual capacity rose faster than demand with a year-on-year increase in capacity, measured in available freight tonne kilometers (AFTK), of 4.4% compared to 6.3% in February. This rapid slowdown in growth is predominantly due to the end of the restocking cycle, when businesses rapidly increased their inventory to meet unexpectedly high demand.
According to Alexandre de Juniac, IATA Director General and CEO: “It's normal that growth slows at the end of a restocking cycle. That clearly has happened. Looking ahead we remain optimistic that air cargo demand will grow by 4-5% this year. But there are obviously some headwinds. Oil prices have risen strongly, and economic growth is patchy. The biggest damage could be political. The implementation of protectionist measures would be an own-goal for all involved—especially the US and China.”
According to IATA, all regions except Latin America reported year-on-year declines in growth in March, with Africa in negative territory.
